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Sea Limited (SE) Q2 Earnings Miss Estimates, Revenues Increase
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Sea Limited (SE - Free Report) recorded earnings of 54 cents per share in second-quarter 2023, which increased 132.3% year over year. However, the figure missed the Zacks Consensus Estimate by 21.74%.
Revenues of $3.1 billion increased 5.2% on a year-over-year basis. The consensus estimate was pegged at $3.42 billion.
Following the results, the stock plunged 28.68% to close at $40.58 on Aug 15. The company’s shares have declined 22% year to date, underperforming the Zacks Computer & Technology sector’s rise of 35%.
Top-Line Details
Digital entertainment revenues of $529.4 million missed the Zacks Consensus Estimate by 7.87% and declined 41.2% year over year.
Sea Limited Sponsored ADR Price, Consensus and EPS Surprise
Free Fire remained one of the largest mobile games globally. The company witnessed signs of improvement in user retention and engagement, led by continued improvements in Free Fire’s core user experience, features and content to ensure a more seamless gaming experience for all users.
Quarterly active users (QAUs) reached 544.5 million compared with the year-ago quarter’s 619.3 million. The metric beat the consensus mark by 14.15%.
Quarterly paying users of 43.1 million represented a paying user ratio of 7.9% in the second quarter compared with 9.1% for the same period in 2022. The metric beat the consensus mark by 19.39%.
Average bookings per user in the reported quarter were 80 cents compared with the year-ago quarter’s figure of $1.20. Bookings were $443.1 million in second-quarter 2023 compared with the year-ago quarter’s $717.4 million.
E-commerce and other services revenues of $2.32 billion beat the consensus mark by 8.11% and increased 32.3% from the year-ago quarter’s levels.
Sales of goods declined 15% year over year to $243.8 million in the second quarter of 2023.
Digital financial services revenues surged 53.4% year over year to $427.9 million. The figure beat the consensus estimate by 1.93%.
Operating Details
Gross profit increased 33.1% year over year to $1.5 billion in second-quarter 2023.
Adjusted EBITDA was $510 million compared with an EBITDA loss of $506.3 million in the year-ago quarter.
Digital Entertainment adjusted EBITDA was $239.5 million compared with $333.6 million reported in the year-ago quarter. The metric beat the Zacks Consensus Estimate by 10.82%.
E-commerce adjusted EBITDA was $150.3 million compared with a loss of $648.1 million reported in the year-ago quarter. The metric missed the consensus mark by 38.28%.
Digital Financial Services' adjusted EBITDA was $137 million compared with a loss of $111.5 million reported in the year-ago quarter. The metric beat the consensus mark by 25.6%.
Balance Sheet
As of Jun 30, 2023, Sea had cash and cash equivalents of $3.52 billion compared with $6.08 billion as of Mar 31, 2023.
Zacks Rank & Upcoming Earnings to Watch
Sea Limited currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the broader Zacks Computer and Technology sector that are scheduled to report their earnings soon are NVIDIA (NVDA - Free Report) , Workday (WDAY - Free Report) and Hewlett Packard (HPE - Free Report) . NVIDIA and Workday sports a Zacks Rank #1 (Strong Buy), whereas Hewlett Packard carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
NVIDIA shares have outperformed the sector year to date, gaining 200.7%. NVDA is set to report second-quarter 2023 results on Aug 23.
Workday’s shares have gained 38% year to date. WDAY is set to report its second-quarter fiscal 2024 results on Aug 24.
Hewlett Packard shares have underperformed the sector year to date, rising 8.4%. HPE is set to report third-quarter fiscal 2023 results on Aug 29.
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Sea Limited (SE) Q2 Earnings Miss Estimates, Revenues Increase
Sea Limited (SE - Free Report) recorded earnings of 54 cents per share in second-quarter 2023, which increased 132.3% year over year. However, the figure missed the Zacks Consensus Estimate by 21.74%.
Revenues of $3.1 billion increased 5.2% on a year-over-year basis. The consensus estimate was pegged at $3.42 billion.
Following the results, the stock plunged 28.68% to close at $40.58 on Aug 15. The company’s shares have declined 22% year to date, underperforming the Zacks Computer & Technology sector’s rise of 35%.
Top-Line Details
Digital entertainment revenues of $529.4 million missed the Zacks Consensus Estimate by 7.87% and declined 41.2% year over year.
Sea Limited Sponsored ADR Price, Consensus and EPS Surprise
Sea Limited Sponsored ADR price-consensus-eps-surprise-chart | Sea Limited Sponsored ADR Quote
Free Fire remained one of the largest mobile games globally. The company witnessed signs of improvement in user retention and engagement, led by continued improvements in Free Fire’s core user experience, features and content to ensure a more seamless gaming experience for all users.
Quarterly active users (QAUs) reached 544.5 million compared with the year-ago quarter’s 619.3 million. The metric beat the consensus mark by 14.15%.
Quarterly paying users of 43.1 million represented a paying user ratio of 7.9% in the second quarter compared with 9.1% for the same period in 2022. The metric beat the consensus mark by 19.39%.
Average bookings per user in the reported quarter were 80 cents compared with the year-ago quarter’s figure of $1.20. Bookings were $443.1 million in second-quarter 2023 compared with the year-ago quarter’s $717.4 million.
E-commerce and other services revenues of $2.32 billion beat the consensus mark by 8.11% and increased 32.3% from the year-ago quarter’s levels.
Sales of goods declined 15% year over year to $243.8 million in the second quarter of 2023.
Digital financial services revenues surged 53.4% year over year to $427.9 million. The figure beat the consensus estimate by 1.93%.
Operating Details
Gross profit increased 33.1% year over year to $1.5 billion in second-quarter 2023.
Adjusted EBITDA was $510 million compared with an EBITDA loss of $506.3 million in the year-ago quarter.
Digital Entertainment adjusted EBITDA was $239.5 million compared with $333.6 million reported in the year-ago quarter. The metric beat the Zacks Consensus Estimate by 10.82%.
E-commerce adjusted EBITDA was $150.3 million compared with a loss of $648.1 million reported in the year-ago quarter. The metric missed the consensus mark by 38.28%.
Digital Financial Services' adjusted EBITDA was $137 million compared with a loss of $111.5 million reported in the year-ago quarter. The metric beat the consensus mark by 25.6%.
Balance Sheet
As of Jun 30, 2023, Sea had cash and cash equivalents of $3.52 billion compared with $6.08 billion as of Mar 31, 2023.
Zacks Rank & Upcoming Earnings to Watch
Sea Limited currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the broader Zacks Computer and Technology sector that are scheduled to report their earnings soon are NVIDIA (NVDA - Free Report) , Workday (WDAY - Free Report) and Hewlett Packard (HPE - Free Report) . NVIDIA and Workday sports a Zacks Rank #1 (Strong Buy), whereas Hewlett Packard carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
NVIDIA shares have outperformed the sector year to date, gaining 200.7%. NVDA is set to report second-quarter 2023 results on Aug 23.
Workday’s shares have gained 38% year to date. WDAY is set to report its second-quarter fiscal 2024 results on Aug 24.
Hewlett Packard shares have underperformed the sector year to date, rising 8.4%. HPE is set to report third-quarter fiscal 2023 results on Aug 29.